The Business Innovation Insider: The long tail of the alcohol distribution curve

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June 23, 2006

The long tail of the alcohol distribution curve

anheuser busch beer.jpg

For those familiar with Chris Anderson's Long Tail theory and eagerly awaiting his new book (The Long Tail: Why the Future of Business is Selling Less of More), it's interesting to note that beer giant Anheuser-Busch recently created a new division called Long Tail Libations. The goal? To find more "niche" alcohol products to supplement the company's "hits". I stumbled across Long Tail Libations in the Wall Street Journal (sorry, no link available), which explained Anheuser-Busch's foray into new markets:

"Anheuser-Busch, battling industry market-share losses to purveyors of wine and liquor, is hinting that it will make an effort to enter the liquor industry... Anheuser has made some tentative moves into the liquor business. Last year, it formed a separate division, Long Tail Libations, to develop, test and market distilled spirits. Its first product, Jekyll & Hyde, a liqueur, is being test marketed in a handful of places. Over the past few years, the St. Louis-based brewer also has joined forces with Bacardi to produce flavored malt beverages, so-called malternatives, under the Bacardi Silver label."

As the president of Anheuser-Busch's U.S. beer operations pointed out, "We will have to re-evaluate our business model going forward in terms of expanding beyond beer and broadening our position within the total alcohol industry." Does that sound like a Long Tail strategy or what? As the Liquor Snob points out, the new Jekyll & Hyde drink is about the furthest thing from good ol' Budweiser beer:

"The company is currently dipping its toe in the hard liquor pond, testing out a new liquor it's developed called Jekyll and Hyde, which comes as two liquors designed to be mixed together. The product comprises of two liqueur bottles. Jekyll is a scarlet red, sweet spirit tasting of wild berries, while Hyde is an herbal tasting, black spirit that floats on top when poured over the red-colored Jekyll. The two products are meant to be served together, although consumers can drink them separately as well, the company said.

We're not quite sure about the idea of mixing wild berries and an "herbal" taste, but we're not in the early-20s demographic this stuff is aimed at, either. Jekyll and Hyde will be made by Long Tail Libations, a subsidiary of the beer giant, and if it is a success Busch will probably continue pursuing its hard liquor dreams. No announcement has been made yet about a national release of Jekyll and Hyde, and the jury's still out on whether it will give you split personalities, one good and one evil."

Tags: longtail Budweiser Anheuser Busch innovation

[image: Anheuser-Busch's distribution]

Posted by dominic at June 23, 2006 6:09 AM | Recommend this! | +dlc | +dig

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